Business and Human Rights – Coming New Global UN Framework Will Test CSR Commitment

Without much fanfare, a ground-breaking piece of global corporate behavioral code has just gone up on the web for consultation. Any firm with international operations should take an interest. This will test your CSR commitment, in very practical terms.

It is about the so-called Guiding Principles, aimed at aiding implementation of a coming UN Framework for business and human rights.

Launched for consultation on November 22 with positive advance noise from key organizations like the International Chamber of Commerce, the Guiding Principles and the whole UN framework will affect the “societal" bottom line (as in the triple economic, environmental and societal bottom line).

So what is this, and why should CCOs care? Let me begin with some background.

The UN “Protect, Respect and Remedy" Framework for Business and Human Rights addresses the complex challenges that arise when business impacts human rights. It does so by seeking to clarify the distinct but interrelated roles and responsibilities of governments and companies.

The framework has been in the making since 2005, when then UN Secretary General Kofi Annan made John Ruggie, a Harvard professor, his Special Representative on business and human rights.

Prof. Ruggie, when he earlier served as UN Assistant Secretary General, had been instrumental in setting up the UN Global Compact, so he came into this work well grounded and with a huge network.

He was called in after an earlier UN attempt to create clarity about business and human rights flopped badly. What Prof. Ruggie has managed to do in the past five years is to create a helpful framework which several governments, international organizations and large corporations already use as a guide. Here's some official text:

The UN “Protect, Respect and Remedy" Framework rests on three pillars:

1. The state duty to protect against human rights abuses by third parties, including business, through appropriate policies, regulation, and adjudication.

States need to ensure that there is coherence across government departments; demonstrate respect for human rights when they do business with business; foster corporate cultures that respect human rights; give guidance to companies operating in conflict-affected areas; and fulfill their duty to protect human rights while participating in multilateral institutions.

2. The corporate responsibility to respect human rights, which means to act with due diligence to avoid infringing on the rights of others, and to address adverse impacts where they occur.

The responsibility to respect human rights applies across all of a company's activities and its relationships with third parties. Grounded in a policy commitment, human rights due diligence should include assessing impacts on human rights, integrating respect for human rights across relevant internal functions and processes, and tracking as well as communicating performance.

3. Greater access by victims to effective remedy, both judicial and non-judicial.

Should adverse human rights impacts result from a company's activities, victims must be able to seek redress. Grievance mechanisms play an important role in both the state duty to protect and the corporate responsibility to respect.

• States must take appropriate steps to ensure that when such abuses occur, those affected have access to effective remedy through judicial, administrative, legislative or other means.
• Non-judicial mechanisms should conform to principles of legitimacy, accessibility, predictability, rights-compatibility, equitability and transparency.
• Company-level mechanisms should also operate through dialogue and engagement rather than the company itself acting as adjudicator of its own actions.

The UN Framework is intended to work dynamically, and no one pillar can resolve the governance gaps that exist. The state duty to protect and the corporate responsibility to respect exist independently of one another, and preventative measures differ from remedial ones. Yet, all are intended to be mutually reinforcing parts of a dynamic, interactive system to advance the enjoyment of human rights.

The UN Framework was welcomed unanimously by the Human Rights Council in 2008 when it was presented by Prof. Ruggie. The Council extended his mandate until June 2011 to 'operationalize' the Framework by developing specific, practical recommendations – the Guiding Principles.

A draft of those recommendations are posted at http://www.srsgconsultation.org . All of the Ruggie team's reports and research are archived at http://www.business-humanrights.org/SpecialRepPortal/Home.

So, why should the CCO care? First of all, because this is important.

It is one more test, and more practical than most, of a company's values, purpose, role in society and ability to demonstrate why communities and nations should welcome its operations, products and services Think reputational risk control, think early warning systems, better stakeholder relations.

As I see in my role as advisor to the Global Business Initiative on Human Rights, implementation will fall on a triumvirate: the CCO, the head of CSR and the head of Legal. But it is the CCO who must make sense of this for others in the executive team.

In The Netherlands, the UN Global Compact member companies already last year looked at their expected gaps vis-à-vis the UN Framework – and produced a neat guidance tool, which is worth checking out.

We will see last-minute wrangling, surely. Consultation closes at the end of January and corporate lawyers will dissect the Guiding Principles. But I expect this to prevail – and that we will see business consultants, law firms and CSR consultants vying to offer implementation support.

Let me also state clearly that I advise – pro bono - John Ruggie and his team on how to communicate with business.

I've been part of this area of CSR for a decade, and I recently joined the new Institute for Human Rights and Business as a Trustee.

I see this as an area in need of clarity, and an answer to a crucial question. How can companies make sure they act with respect for the dignity of all they impact.